Klotho Brands Limited v Kevin-Gerald Stanford

A court order must be obeyed while it remains in force, even if the party affected believes it is irregular, void or liable to be set aside. A later setting aside normally has prospective effect and does not cure an established past contempt.

Contempt based on breach of an order requires knowledge of the order and deliberate conduct which in fact breaches it. Knowledge that the conduct amounts to contempt is unnecessary. Purging a prohibitory contempt cannot technically occur before sentence, although later compliance, contrition and assurances may mitigate sentence. Sentencing should assess culpability and harm, with custody justified where a fine would be ineffective and the breach is sufficiently serious.

The claimant sought sentence for two contempts committed by the defendant through breaches of an injunction granted on 5 April 2022. The defendant had been found guilty of both contempts in an earlier judgment and was absent and unrepresented at the sentencing hearing.

He made applications to set aside the injunction for alleged fraud, to strike out the contempt application for want of a board resolution, and later to stay sentencing pending a fresh Part 7 claim. The court dismissed those applications and considered whether the defendant’s asserted lack of intent, alleged purge and proposed future compliance affected sentence.

1. Applications. The application to stay sentencing pending the fresh Part 7 claim was dismissed as totally without merit. Even if the injunction were later set aside, that would not retrospectively affect the defendant’s past conduct or the existing decision that he was in contempt. An order of a competent court must be obeyed unless and until discharged: Hadkinson v Hadkinson [1952] P 285, as approved in Isaacs v Robertson [1985] AC 97, M v Home Office [1994] 1 AC 377 and R (Majera) v Home Secretary [2022] AC 46.
2. The alleged non-joinder of the family trust did not invalidate the proceedings. Even assuming a procedural rule had not been followed, Civil Procedure Rules 1998, rule 3.10 prevented the step or proceedings from being invalidated. The claimant could sue the party it chose, and the trust had not been prejudiced. The application based on the absence of a board resolution also failed: no rule or article required such a resolution, and regularity was presumed.
3. Liability and purge. Following Atkinson v Varma [2021] Ch 180, once knowledge of the order and deliberate acts or omissions are proved, it is unnecessary to prove knowledge that the conduct constituted a breach. A person cannot technically purge a completed breach of a prohibitory order before sentence. Later conduct may mitigate sentence, but the defendant had not acknowledged the order, recognised his contempt, apologised or promised compliance.
4. Sentence. Applying the Sentencing Council Guidelines, and the approach referred to in Attorney General v Crosland [2021] 4 WLR 103, culpability was assessed as band B and harm as level 2. The starting point was 12 weeks’ imprisonment for each breach. The two distinct breaches warranted 16 weeks on each count, consecutively, making 32 weeks. A fine was inadequate, particularly given the defendant’s bankruptcy. The sentence was suspended for two years on the express condition that he made no further statements or communications casting doubt on the claimant’s title to the shares, except in good-faith court documents in the fresh claim.

Not stated in the judgment.